31st Aug 2012, by Agrimoney
The International Sugar Organization called time on the four-season spell of squeezed sugar supplies which drove futures to a 30-year high, foreseeing record production keeping prices under "bearish pressure".
he group, in its first formal forecasts for 2012-13, forecast world sugar output rising by 2.3% to a record 177.4m tonnes, led by a sharp recovery in Brazil, the biggest producer.
Brazil's output will "improve considerably", soaring 11% to 38.1m tonnes during the season, on the October-to-September season the ISO strictly follows, if remaining below the record 40.9m tonnes set three years before.
However, consumption will rise more slowly, by 1.9%, to 171.5m tonnes, leaving the world with an output surplus of 5.9m tonnes.
'Bearish pressure'
While the ISO slashed its estimate of the 2011-12 surplus by more than 1.3m tonnes to 5.3m tonnes, reflecting more buoyant ideas of consumption, the world looks set to see a substantial rebuilding on world inventories.
The stocks-to-use ratio, an indicator of the tightness of supplies of a raw material and therefore of its price potential, looks set to return by the end of 2012-13 to "around 40%".
"This suggests that the period of low stocks environment, one of the main market characteristics for the past four seasons from 2008-09 to 2011-12, would be over," the organisation said, signalling a downward influence on values.
"The ISO believes that prices could remain under bearish pressure."
The International Sugar Organization called time on the four-season spell of squeezed sugar supplies which drove futures to a 30-year high, foreseeing record production keeping prices under "bearish pressure".
he group, in its first formal forecasts for 2012-13, forecast world sugar output rising by 2.3% to a record 177.4m tonnes, led by a sharp recovery in Brazil, the biggest producer.
Brazil's output will "improve considerably", soaring 11% to 38.1m tonnes during the season, on the October-to-September season the ISO strictly follows, if remaining below the record 40.9m tonnes set three years before.
However, consumption will rise more slowly, by 1.9%, to 171.5m tonnes, leaving the world with an output surplus of 5.9m tonnes.
'Bearish pressure'
While the ISO slashed its estimate of the 2011-12 surplus by more than 1.3m tonnes to 5.3m tonnes, reflecting more buoyant ideas of consumption, the world looks set to see a substantial rebuilding on world inventories.
The stocks-to-use ratio, an indicator of the tightness of supplies of a raw material and therefore of its price potential, looks set to return by the end of 2012-13 to "around 40%".
"This suggests that the period of low stocks environment, one of the main market characteristics for the past four seasons from 2008-09 to 2011-12, would be over," the organisation said, signalling a downward influence on values.
"The ISO believes that prices could remain under bearish pressure."
No comments:
Post a Comment